What does self-sufficiency mean in the face of skyrocketing housing costs?

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When I was asked to join the Access to Opportunity Project, I did not hesitate to say “yes”. Because of my own lived experience, I have committed my adult life to improving the plight of poor people and communities.

I come from a low-income family in rural Appalachia. My family’s income was so low that as a community college student, my application for federal student aid was rejected because the U.S. Department of Education assumed I must have entered my parents income incorrectly. After persisting through a lengthy process of convincing all involved that my parents’ really had earned close to $8,000 that year, and not $80,000, I was grateful for the Pell Grants and other aid that helped support my education. During my journey from those humble beginnings to earning a Ph.D. and becoming a professor and researcher, I have spent a lot of time thinking about the windows of opportunity that allowed me to end up where I am today. I continue to consider which structures, supports, and opportunities were idiosyncratic to my personal situation, and which might be systematically replicated through effective policies and programs to allow other young people to reach their true potential. My personal background is part of what makes me deeply excited about the Access to Opportunity project, and its potential to inform policy and make tangible impacts in local communities.

I have lived in San Diego for ten years, and though the city is very different from the rural mountain communities where I grew up, it poses its own challenges to low and even moderate income families. San Diego is consistently ranked among the least affordable housing markets in the United States, topping that list in 2015[1], and coming in at number two in 2016[2]. Rather than looking exclusively at housing costs, assessments of housing affordability consider housing costs in relation to how many residents of a community could afford to purchase a home at the median price. In 2015, real estate industry research showed that less than half of households could qualify to buy a median priced home in 93.3 percent of San Diego zip codes. This was the highest ratio of any city in the study[3]. Some find San Diego’s ranking surprising when considering notoriously high-priced cities like New York or San Francisco. Though San Francisco does have higher home prices, San Franciscans’ higher incomes mean that the ratio of residents who cannot afford to buy homes was lower than in San Diego in 2015 (though still alarmingly high). In the fourth quarter of 2016 the median home price in San Diego rose to $593,000. This means one requires an annual income of more than $113,000 to qualify for a mortgage loan, and then will pay a mortgage of nearly $2,650 a month[4]. West coast cities dominate the list of the top ten least affordable housing markets. Boston, Miami and New York were the only east coast cities to join cities like Portland, San Diego, and Seattle on the list of the top ten least affordable housing markets in 2015[5].

A shortage of housing units in San Diego County means it is not only aspiring homeowners who bear the burden of high housing costs; renters are also under extreme pressure. Fifty-seven percent of renters in the San Diego region are rent-burdened, meaning they spend at least 30 percent of their income on rent- the 10th highest figure in the country[6]. The San Diego Housing Commission estimates that since 2014 the San Diego region has produced only four percent of the number of moderate income housing units needed to meet demand, and only six percent of the number of low income housing units needed to meet demand, compared to thirty-one percent of high income units needed. At present a renter needs to earn three times the minimum wage to pay the median rent price in San Diego, meaning many working class families pay up to 70% of their income on rent, or are choosing to leave the region altogether[7].

Like many public housing authorities nationwide, one of the San Diego Housing Commission’s signature programs within its Achievement Academy is the Family Self-Sufficiency (FSS) program. As we delve into our research on the effectiveness of programs for the housing insecure, we must first decide the meaning of “self-sufficiency” in this context. While obtaining self-sufficiency is the stated goal of the FSS program, there is no clear consensus on how to define self-sufficiency among government or social service providers[8]. Self-sufficiency technically can be defined as subsisting without external support, which suggests total financial independence from government aid. But scholarship is at odds with whether this is an effective measure for appraising the success of such programs[9]. For much of history, social assistance in the United States focused on moving low-income individuals to employment, with the assumption that earned income would remove the necessity for other services. It is unlikely, however, that the simple act of obtaining a job will be enough to move a family completely off of public assistance and make them entirely self-sufficient in the long-term, especially in high-cost cities.

Low-income individuals face considerable obstacles to gaining and retaining employment and adequate income. A lack of education, training, or job experience can result in access to only low-wage jobs that cannot financially sustain a family. In 2016 the US living wage was approximately $15.85—this means that two adults would need to earn $15.85 per hour each in order to afford the basic necessities such as food, housing, and transportation for a family of four[10]. This is more than twice the federal minimum wage of $7.25. In San Diego, families need to earn three times the minimum wage just to pay median rent[11]. This suggests that most low-income earners would not be capable of financial self-sufficiency based solely on earned income. Difficulties such as accessing childcare and transportation make it even more challenging to maintain employment, putting low-income families at risk for job and income loss. It is important, then, to consider additional services such as education and job training to help support long-term employment and increased earning potential—all of which support increased independence from assistance over time[12].

Research suggests that a more holistic approach to self-sufficiency considers all of these factors- as well as more qualitative factors such as self-worth, independence, and sense of future- on a continuum with the goal of helping to move families toward higher degrees of self-sufficiency. Screening individuals for autonomy and self-determination, financial security and responsibility, family and personal well-being, and basic assets is a more effective means to determine self-sufficiency. Under this approach, programs seeking self-sufficiency should attend not only to a client’s need for income but also to their financial literacy and ability to manage their money, their interpersonal relationships and coping skills, and factors affecting their overall contentedness and happiness[13].

The Achievement Academy at the San Diego Housing Commission appears to embrace this approach as it administers the FSS program to Section 8 recipients. The Achievement Academy offers workshops and counseling, as well as outside referrals, to assist with a multitude of issues including budgeting, parenting skills, job procurement, entrepreneurship, financial literacy, welfare eligibility, and more. Like most housing authorities providing FSS, the San Diego Housing Commission provides participants with an escrow account, and the average San Diego participant earns $6,800 by graduation. Participants work with case managers to set milestone goals that might include employment, a wage increase, earning a degree or credential, or gaining independence from some form of public assistance, and can earn extra incentive deposits to their escrow account for meeting these goals. In order to successfully complete the program and graduate, participants must meet their specific goals and attend regular meetings with case managers. More than half of FSS participants typically graduate, moving these individuals steps closer to self-sufficiency.

Our mix of qualitative and quantitative research methodologies allows us to more holistically assess what aspects of self-sufficiency programs are most effective. In addition to conducting analysis of client participation, Access to Opportunity researchers are following a subset families over time, conducting in-depth interviews, collecting interim data by e-mail and text message, and making visits to some participants’ homes, schools, and workplaces. Through these efforts, we will better understand how to increase real opportunities for self-sufficiency in the San Diego region and beyond.